Will Cost Of Living Crisis Effect Your Business?

The Cost Of Living Is Effecting Us All

The UK is facing a challenge bigger than the COVID pandemic of 2019 and that is the cost of living crisis that we hear about in the media every day.

Prices for food have gone up across the board.  Petrol prices have gone up to nearly £2.00 a litre.  Utilities have all raised their prices.  However wages remain the same as they always were.

Councils have raised their council tax.  Rents have gone up for those in the rental market.

Housing prices have gone up despite hundreds of thousands of new houses being built all around the UK.

Many companies blame this on the war in Ukraine or the COVID ripple still effecting supply chains.

How is this effecting your business?  How is this effecting your household?

It Is Not Just SME’s That Feel The Pinch

Netflix has seen a massive decline in over 200,000 subscribers in the first 3 months of 2022 as families cut back on their monthly costs.

Morrisons has lowered the prices on around 500 items (which is a good PR story for the newly acquired American owned food giant).

Restaurants re-opening as the cost of energy has shot up, and the cost of raw ingredients have also gone up.

Food delivery services like Deliveroo and JustEat have seen their business boom.  Even though the COVID-19 pandemic has pretty much come to an end, food delivery services have seen their profits rise.

Electric Cars

Despite the cost of living effecting business and consumer, the number of electric cars on UK roads has increased since the pandemic started.

How can people afford a £45,000 electric car if the cost of living has seen many turning to food banks?

The growth in the electric car market demonstrates that the cost of living crisis may not be quite as bad as the media portrays?

There is no typical user of electric car, mid 30’s, retired couples are all driving around in brand new electric cars.

Is the UK cost of living quite as bad as it seems, if people can afford paying up front or on finance for a £45,000 car?

Why Is There A Cost Of Living Crisis?

We can only turn to the media to as why there is a cost of living crisis and this is blamed on the war in Ukraine and COVID.

Apparently the global lockdowns meant that all businesses, from computer chip manufacturers, building suppliers, PPE firms, manufacturing companies shut down for many months.

This slump is now causing a global shortage of many things, which will take time to return to a new normal.

How Can Marketing Help Your Business?

Communication to customers is important if you want to see your business survive the cost of living crisis and emerge at the other end.

Are you increasing your prices?

Many companies are responding by either keeping their prices held, or increasing them to meet the shortfall.

Marketing is essential to your business surviving this crisis.  Updating your website is important, as is using PR to get your message into the media.

The internet is now the preferred marketing tool as we have moved into the digital world.  Many of us are using social media websites such as Facebook and the Chinese owned platform Tik Tok.

Are you using a marketing agency to do these things, or are you thinking of using one?

How Do Employees See The Cost Of Living?

Employees see food costs going up, petrol going up, council tax is up and housing prices continuing to rise.

Many UK companies since COVID-19 allow staff to work from home.  This bring commuting time down, travel costs down but allows more time to be spent with the family at home.

Many UK companies have given feedback that employees working from home does not mean lack of productivity.

However many managers and business owners prefer staff to work from the office.

After all, what is the point in having a UK office, with all of the costs associated with running an office if no staff are there 50% of the time?

Getting Help With Cost Of Living

When hair dressers re-opened after the lockdown was lifted back in 2020, many of them put their prices up a few pounds, to compensate for them being closed for 5 months.

Now we are a few years on, no hair dresser has brought their prices down to pre-pandemic rates.

We are seeing everything gradually go up in price.  This has been blamed on the war in Ukraine and COVID and is unlikely to change.

Housing prices have been going up for decades.  A house that used to cost £50,000 in 1980 will cost around £500,000 in 2024.  Wages have not gone up in the same proportions and £1.00 in 1980 is still £1.00 in 2024.

Getting help with the cost of living is important whether you are a business or a consumer.

Talking to friends and family is important, as communication about problems is always better than remaining silent.